An energy-market concept empowering households to manage renewables
This project gives a large-scale demonstration of a market concept that supports active user participation to manage smart electricity distribution networks that rely on renewable energy. The project aims to remove the barriers that currently prevent small-scale consumers from participating in the power-balancing market – which helps integrate renewable energy into large grids – to give a stronger voice to these customers.
Worldwide, the share of wind and solar in the energy mix is growing, and is expected to continue to grow. However, these energy resources are highly variable and difficult to forecast. That creates a challenge in making sure there is enough power to meet demand or that all the energy from renewables is used.
Bringing consumers into the market and activating their electricity demand create additional capacity to keep the power system in balance and operate it more securely and economically.
In the EcoGrid model, consumers use automated power-management systems that respond to real-time power price signals. These signals are based on current prices in the conventional power-balancing market. Signals are created every five minutes, with prices increasing when there is a power deficit in the system and going down when there is a power surplus.
Because prices are updated quickly – every five minutes – the network can cope more easily with large amounts of rapidly fluctuating renewable energy sources. The market price is set at the very last minute, so very accurate forecasts of wind power and demand can be used when determining the market prices, minimising problems with the forecast errors present in the conventional markets.
This system allows small-scale and residential electricity consumers to participate in the power market. They help balance renewable electricity generation by actively changing their demand for power in response to availability, which is signalled by the prices. The concept also allows congestion in the local power grid to be reduced.
EcoGrid has tested this concept with 2 000 residential households on Bornholm – a Danish island connected to the Nordic electricity market – where the local distribution system operator (DSO), Østkraft, has already experienced balancing challenges from its high share of wind power. One in ten electricity consumers on the island took part in the test.
Most test participants were equipped with demand-response devices with smart controllers and meters that they could pre-programme to respond to real-time prices based on each household’s demand-response preferences. This allowed these small-scale customers to offer additional balancing to the transmission system operators (TSOs). Results showed that whether they used automated control systems or not, EcoGrid customers achieved the real-time demand response they were looking for.
The project’s concept can be applied generally. It reduces the need for production side flexibility, which is more expensive, and can compensate for traditional balancing power and services from replaced conventional generation. And for customers, it makes renewable energy more reliable, while helping them keep control of their bills.
Partners in the project:
- Energinet.dk, Denmark (Initiator)
- Sintef, Norway (Coordinator)
- Østkraft, Denmark
- Danmarks Tekniske Universitet, Denmark
- Landis+Gyr, Denmark
- IBM, Denmark/Switzerland
- SIEMENS, Denmark / Germany / Switzerland
- Elia, Belgium
- Eandis, Belgium
- Talinn University of Technology, Estonia
- ECN, The Netherlands
- TNO, The Netherlands
- EDP, Portugal
- Tecnalia, Spain
- AIT, Austria